Governmental Pursuits to Redirect Yemeni Funds to the Banking System

London- The National Bank of Yemen has announced that it will issue on Sunday USD funds in the local market to be sold in a public auction—this step aims at providing a monetary liquidity of the current currency which is undergoing a tough condition in Aden and Sana’a.

The bank, in a statement issued on Friday, announced that upon the request of specialized governmental parties there will be an auction for traders, companies, exchange stores and commercial banks.

According to Reuters, USD20 million will be issued in the auction but the bank remained discrete regarding the worth or source of these funds.

Economists affirmed the importance of governmental banks’ approach to sell USD funds in the public auction since this contributes in returning the liquidity to the banking system. They attributed the current liquidity crisis to great funds being traded outside the banking system.

Since three months, Yemen has been suffering lateness in paying salaries of public employees 1,200,000 employees earning YER75 billion per month.

The new administration of the Yemeni Central Bank stated that Houthis have spent billions for war reasons—this actually compelled the government to transfer the headquarters and its operations to the temporary capital.

Yemen is undergoing a first of its kind financial crisis since the Houthis’ seizure of the capital and hurdling oil exporting and the arrival of foreign investments and aid.

Furthermore, the World Bank approved to issue a financial portfolio of urgent intervention worth USD400 million to provide food, medicine and basic needs for residents.

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